Reviving oil palm sector

The federal government’s new plan to revive oil palm production and control 10 per cent of its global market in the next six years is ambitious but achievable. The initiative to restore Nigeria’s leadership in the sector will also make Nigeria self-sufficient in oil palm production by 2050, ensure food security and lift no fewer than two million Nigerians out of poverty. While unveiling the long-term strategy in Abuja recently, the Minister of State for Agriculture and Food Security, Sabi Abdullahi, said transforming the sector required a coordinated national approach.

Similarly, the national president of the Palm Produce Association of Nigeria, Dr. Alphonsus Inyang, has said the strategy will make Nigeria a major player in the industry, with a projected annual production of between nine and 10 million metric tonnes by 2050. Under the plan to reform the sector, the government will establish a National Oil Palm Council (NOPC), an Oil Palm Development Fund and a National Smallholders Development Fund. Consequently, the Nigerian Institute for Oil Palm Research (NIFOR) would be transitioned into the Nigerian Oil Palm Board, with the aim of overseeing research, development and innovation in the sector.

The national strategy to revive the oil palm sector will be implemented from 2026 to 2050. The key initiatives of the plan include the expansion of oil palm cultivation to some northern states, modernizing oil palm mills and promoting smallholder-inclusive, sustainable and traceable production that will boost exports and considerably reduce import reliance. In the same vein, the National Palm Produce Association will expand oil palm production beyond the traditional southern belt to include northern states such as Taraba, Niger, Kogi and Nasarawa, which have suitable ecological conditions like vast land availability and longer sunshine hours for large-scale oil palm farming.

The plan, championed by the National Palm Produce Association, will unlock new agricultural frontiers and largely increase output to satisfy rising local and international demand. The initiative envisages the planting of 100 million oil palm trees, upgrading of outdated mills and launching of the National Palm Oil Traceability System (NaPOTS) to meet export standards and improve product transparency, specifically, for exporting to European Union (EU) countries. Good enough, stakeholders in the sector have also pledged to expand plantation areas by 1.5 million hectares by 2029.

Currently, smallholder farmers, who are supported with better, high-yield seeds and financial incentives to improve productivity, contribute over 80 per cent of Nigeria’s oil palm production output. The new initiative will focus on climate-smart, deforestation-free, and sustainable policies. For instance, Taraba State is reportedly taking the lead, working in partnership with industry stakeholders to be a major hub for oil palm production.

The state will play a central role in ensuring the success of the oil palm expansion in the north. The expansion will create more jobs, enhance rural development and increase investment in agro-processing industries. It will also boost food manufacturing, cosmetics, pharmaceuticals and biofuels. To combat high levels of manually processed, low-yield palm oil, the government will provide modern processing machinery to increase output.

Unfortunately, Nigeria’s domestic palm oil production can only meet about 75 per cent of demand, with the shortfall covered by imports from Asian countries, especially Malaysia. The USDA says that Nigeria’s palm oil output is expected to reach 1.5 million tonnes in 2026, while demand stands at 1.95million tonnes. It is hoped that successful implementation of the new strategy would strengthen Nigeria’s global position in its aspiration to be among industry leaders in the oil palm sector.

In November last year, the government reiterated its plan to reform the palm oil sector and increase the nation’s output. The plan to reform the sector was one of the outcomes of the Policy Dialogue on the Comprehensive African Agricultural Development Programme (CAADP) held in Abuja, with the theme: “Policy Funding and Strategic Roadmap for Nigeria’s Oil Palm Sector.” During the dialogue, it was projected that the sector had the potential to unlock over $1.6billion in value across the industry.

The programme manager at Solidaridad West Africa, Nigeria, Kene Onukwube, who spoke at the event, said that “27 of Nigeria’s 36 states have suitable conditions for large scale oil palm cultivation. If these states are fully mobilised, the economic benefits could be enormous from increased rural incomes to foreign exchange gains.” Onukwube’s submission is in tandem with the new roadmap to enhance oil palm production.

We laud the new plan to reform the oil palm sector and make Nigeria a global leader. At the same time, we call for its seamless implementation. At independence, Nigeria was the largest producer of palm oil in the world. Nigeria’s sufficiency in the sector was so efficient that Malaysia came to Nigeria to borrow palm oil seedlings. With the discovery of crude oil in commercial quantity and coupled with the oil boom of the 1970s, the palm oil sector was highly neglected and Nigeria dropped from its leadership position in oil palm production.

Later, it started importing palm oil to augment domestic and industrial needs. Therefore, it is very commendable that Nigeria intends to return to its prime position in oil palm production with the new roadmap. However, the recent lowering of tariff on oil palm importation may hinder the aspiration to be a global player in oil palm market. Arising from this, we urge the government to revisit the new tariff regime with a view to discouraging the importation of palm oil.